Decline and Fall

One of the features of American politics during the past few decades has been the emphasis on togetherness. Yes I know that sounds absurd, but hear me out. Our political landscape has been carefully segregated into two separate and distinct zones: that of social conflict and that of economic harmony.

The zone of social conflict is where the great cultural war has been fought. It began as a counter-revolution to the advances of the 1960’s and especially to the establishment of civil and women’s rights as central political themes. The conservative elements of society who found both those rights movements repugnant and/or destabilizing gradually regrouped and then emerged with sufficient force to condemn an entire generation to fruitless combat. The entire political landscape became littered with “them or us” issues cast in stark contrast and drained entirely of any semblance of nuance. Either you were “for” something or you were “against” it. There was no room for anything that could resemble compromise.

This phenomenon strangled the entire political class. It sucked the air out of dialog and caused every single issue to be seen through an unreal lens. Nothing is so black and white, yet everything became seen as such. Politics thus was infused with bitterness and rancor that had no hope of being eliminated. Every election ratcheted that stakes higher. And no resolution was ever found.

The media too was sucked into the mire. It began to speak of the world as having two halves. In order to be balanced the media then described both sides as moral equivalents regardless of history or facts. Every time someone said something extreme on one side the media responded by trying to locate someone on the other side who could be shown to be as equally extreme. The media thus lost any ability to provide a moral compass. It simply became a score keeper unable to tell the difference between the moral implications or foundations of any argument. Reporting became an accounting exercise.

This whirl of enmity and radical position-taking ironically resulted in what we all observe as the political gridlock we fault politicians for. So deep were the passions on either side that no movement was possible, no compromise available, and thus no resolution likely. Instead cynicism and disillusionment infected the electorate to the extent that trust in the political process has virtually broken down. Ultimately both sides in the war have become too intransigent and frustrated for progress. We need them simply to fade away. Only a new generation can resolve the battles begun back in the 1960’s, which is, perhaps, what we are now seeing in the attitudes of you’re people in the current selection. They seem to be less apt to fight over social issues, most of which they accept as being settled, instead they are looking at something else.

Which gets me to the second great zone: that of economic harmony.

Here the media and the political elite went in a totally different direction. Instead of the arguments being filled with insurmountable divisions they were deliberately cast as technical squabbles within an over-arching zone of agreement. Here’s how it happened:

During the great counter-revolution of the 1980’s the Democratic party chose to fight only on social issues. It surrendered completely on economic issues. It never attempted to offer the electorate an alternative too the neoliberalism of Reagan. Instead it accepted hook line and sinker the neoliberal meta-themes, and contend itself with tinkering around the edges.

Bill Clinton led the charge in this. His economic program was distinctly right of center, despite being criticized by his opponents as leftish.

Contrary to the bitterness on social issues the economic debates became engulfed in techno-speak. Naturally the economics profession was deeply involved in this descent into jargon. Nor were the two sides so divided: not only did the Democrats become advocates of neoliberalism, but the Republicans have jumped about all over the place on issues such as the Federal deficit. After all it was Dick Cheney who famously told us all that depicts don’t matter, and it was Reagan himself who first plunged the nation into permanent red ink. The Democrats lambasted Republican presidents for fiscal irresponsibility, and the Republicans happily grew the size of government whilst proselytizing the virtues of small government. Nothing was quite as it seemed. The extent of overlap on economic policy was remarkable.

This is what I mean by harmony.

Neither party, then, during the entire period of the cultural wars was being entirely honest with their respective supporters on economic matters. Indeed, the unity was quite the opposite from the divisions being presented to us on the social side.

The media too became part of the illusion. Anyone beginning to discuss an alternative to the idea that “a rising tide floats all boats” was castigated as fostering class war. And nothing is worse, apparently, than fostering class war.

Except, of course, that the unity between the parties was itself founded on class war. Neoliberalism is a particularly pernicious form of class war because it prides itself on being founded on classical economic principles. Which, as we all have been taught, is “positive” economics drained of all taint of moral overlay and other forms of bias. Positive economics tells us that the economy just is. And economists are simply purveyors of the oft times dismal news: stuff happens in the economy and we can’t get in the way. Least of all should we deploy the government since, by definition, the government is an irritant in the market place and we all know that the market place is always right. So there.

The unity of the parties in the aftermath of the Democratic capitulation coincided with the growing dependence of our political system on cash. Politics became a business. Parties set up great cash raising efforts. Candidates became enthralled by cash givers. Any other part of the world would see this process as corrupt. Here in America we call it free speech.

But corruption is corruption. With the greatest corruption coming not during but after the elections. This is when Congress is awash with corporate and wealthy donor lobbying.

It is little surprise then that our economy is beholden to those who have lots of cash. It is little surprise that the greater portion of our collective prosperity is captured and enjoyed by those with lots of cash.

There is nothing new in this observation. The harmony between the parties gave cover for the heist. A contentious debate would have exposed the robbery more clearly. It would have been in someone’s interest to break ranks.

Which gets us back to the decline and fall. or, rather, the perception of it.

What sets this election apart from those of the last few decades is that there is a difference. The economic harmony is being challenged. Whether the challenge is enough to break through this year I doubt. But the challenge will not go away. The critique is there for all to see: Hillary Clinton is firmly part of the neoliberal past. Her hands are all over the economy that we now have. If that economy is failing the majority of people, then Hillary Clinton has failed the majority of the people. She cannot claim vast experience and insider advantages without also owning the consequences. Our economy sucks for most people. Therefore, for most people, Hillary Clinton sucks.

The decline and fall is not of America, but of the harmonious fallacy of the elite. The harmony is breaking. Which is good news for most of us.

Share this:

Politicians didn’t want to embrace neoliberalism. Politicians are lawyers. They ask the expert witnesses. There is a wonk gap, as Krugman explains, but he’s the epitome of the gap. He draws liberal policy preferences from neoliberal axioms b/c there is no connection between economics and reality. Don’t blame lawyers for having nowhere to turn.

Blame heterodox economists. Why? Because 200 years of wrong does not happen in the face of a valid critique. Therefore, something is wrong with the critique.

What is wrong? I think heterodox economists give the game away once they buy into the idea that the subset of human social organization can be visualizes using Newtonian/Cartesian metaphors. Once you draw an x axis and a y axis you have turned your back on Darwin, and therefore every useful science of living things. Are humans alive? Then stop drawing curves and start thinking about trees!

Specifically, if you read it in Marx, it is explicitly Newtonian and therefore wrong.

I could be wrong about the Newton/Darwin thing, but there is no valid argument against the solid inductive proof that the heterodox are wrong.

You seem to believe that corruption must be a bad thing. During the 19th century, when politics was really about both money and mass denial of democracy what saved the country and began it on the way to more equitable distribution was corruption. The politicians I worked for in TX during the 60s and 70s learned their politics during FDR’s “New Deal.” From politicians that still reflected the conflicted society following the Civil War. Some were assholes you wouldn’t turn your back on. But most were problems solvers who looked for compromises. They did this because they had seen first-hand the hell that can break loose when you don’t do it. Their constituents included rich people and poor people, union members and factory owners/managers, professionals like medical doctors, and of course academics like economists and historians. All had a story to tell, filled with half-truths, outright lies, and desires of all sorts. It was the politician’s job to somehow find ways to make and maintain a nation from these different constituents. And doing this often involved what you call corruption. That’s what compromise is all about. Compromise is not some high, philosophical process. Rather, it is messy, chaotic, stressful, and often dangerous and corrupt. Using tax money to fund relief for families of workers hurt/killed on the job, lowering/removing taxes on the homes of rich factory owners so the factory would stay open, using utility rate money to fund city work projects that employed 60 men when only 30 were needed, etc. The problem we face today is that we don’t have enough corrupt politicians to keep the place going. They’re all become constituents instead, telling their stories filled with half-truths, lies, and all sorts of desires of which they take offense if others tell a different story, with different lies, half-truths, and desires. They want whatever is done to be fully in accord with their story, and only their story. And they want all the other stories rejected. They will accept only ideological purity. With that you get no compromises, no corruption, and no nation.

Sorry Peter, we might have had an effort to reach economic consensus 1945-1970 in the postwar New Deal influenced society. You’ll remember big labor’s partnership with corporate management to spread the wealth through collective bargaining. That was to have been America’s answer to Communism. But the consensus broke down in the 1980s when corporate management abandoned social responsibility in order to enhance so-called shareholder value. Benefits disappeared with the speed of light and so did narrowing the gap between the rich and the poor.

Comments on recent RWER issues

Real World Economics Review

The RWER is a free open-access journal, but with access to the current issue restricted to its 26,498 subscribers (07/12/16). Subscriptions are free. Over one million full-text copies of RWER papers are downloaded per year.

—- Forthcoming WEA Paperbacks —-

———— Armando Ochangco ———-

Shimshon Bichler / Jonathan Nitzan

————— Mauro Gallegati ————–

————— Herman Daly —————-

————— Asad Zaman —————

—————– C. T. Kurien —————

————— Robert Locke —————-

Guidelines for Comments

• This blog is renowned for its high level of comment discussion. These guidelines exist to further that reputation.
• Engage with the arguments of the post and of your fellow discussants.
• Try not to flood discussion threads with only your comments.
• Do not post slight variations of the same comment under multiple posts.
• Show your fellow discussants the same courtesy you would if you were sitting around a table with them.